Ukraine suggests compromise price in gas row with Russia

Newly appointed head of the Ukrainian Naftogaz state oil and gas firm Andriy Kobolev gestures as he speaks during a press conference in Kiev on April 1, 2014. Ukraine said on Friday it was ready to pay a compromise price for Russian natural gas for 18 months to avert the threat of Moscow cutting off supplies and allow time to reach a long-term pricing agreement. -- PHOTO: AFP

KIEV (Reuters) - Ukraine said on Friday it was ready to pay a compromise price for Russian natural gas for 18 months to avert the threat of Moscow cutting off supplies and allow time to reach a long-term pricing agreement.

Mr Andriy Kobolev, chief executive of state gas company Naftogaz, said the price of US$326 (S$407) per 1,000 cubic metres - higher than what Kiev wants to pay and lower than what Russia demands - was proposed by the European Commission during talks.

In talks that are made even more difficult by the conflict in Ukraine, in which Kiev accuses Moscow of backing a separatist rebellion in eastern regions, Russia has threatened to cut off supplies to Ukraine if it fails to start paying off billions of dollars in debts by Monday.

The Russian Energy Ministry has ruled out holding any more talks with Kiev and the European Union before the Monday deadline. "In our opinion the European Commission has proposed a compromise that is not bad," Mr Kobolev told reporters, suggesting that Kiev should pay this price for an 18-month interim period. "Ukraine will be ready under such a compromise to pay its unpaid bills from the past," he said.